Trade Setup for August 22: Nifty aims to end the week on a high with 25,150 being a barrier

The bulls extended their winning run for the sixth consecutive session on the weekly expiry day, Thursday.

After opening on a positive note near the 25,140 zone, the Nifty slipped towards 25,050 in the first half hour. However, the bulls defended that support and triggered a sharp rebound, pushing the index to the day's high of 25,153 within the next hour.

Post 2:20 pm, the index came under profit-booking pressure and fell nearly 85 points from the day's high, closing near the day's low.

The Nifty failed to decisively cross the 25,150 mark and later moved into a narrow range till the end of the session. Overall, it traded in a choppy 100-point range before ending with modest gains of 33 points, just below the 25,100 level.

Leading the charge among the Nifty's top performers were pharma heavyweights Cipla and Dr. Reddy's Laboratories, along with Bajaj Finserv. On the flip side, Tata Consumer, Bajaj Auto, and Eternal ended as the major laggards within the index.

Among sectoral indices, Nifty Pharma, Healthcare, and Realty emerged as the top gainers. In contrast, FMCG, PSU Bank, and Auto slipped into the red, reflecting sectoral rotation.

After a three-day rally, the broader market witnessed profit booking at higher levels. The Nifty Midcap 100 declined 0.38%, while the Nifty Smallcap index also closed marginally lower.

Meanwhile, both domestic and foreign investors were net buyers in the cash market on Thursday.

Looking ahead, as long as Nifty sustains above the 25,000 mark, momentum could extend towards 25,200-25,300, according to Chandan Taparia of Motilal Oswal. On the downside, supports are gradually shifting higher and are now placed at 24,900 and 24,800 zones.

Nagaraj Shetti of HDFC Securities said that while the overall uptrend remains intact, short-term consolidation or minor weakness cannot be ruled out over the next one to two sessions before the index heads higher towards the 25,300 level. Immediate support is pegged at 25,000.

In the near term, the index may consolidate with the 25,150-25,200 zone acting as immediate resistance and 25,000 as near-term support, followed by this week's low of 24,850, said Rajesh Bhosale of Angel One.

He added that traders should maintain a positive bias and use dips to buy, while a sustained move above 25,200 could open the way for 25,350 and 25,500, setting the tone for the final week of August.

Rupak De of LKP Securities said sentiment remains positive with the index holding comfortably above its short-term moving average. "On the downside, support is placed at 24,800; as long as this level holds, a buy-on-dips strategy is likely to prevail. On the upside, resistance is seen at 25,250 and 25,500."

Note To Readers

Disclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.